Exemption advance business tax for young employees

If you recruit a young employee in October, November or December 2016, no advance business tax needs to be withheld during those months provided the following conditions have been complied with:

1. The young employee must not be subject to compulsory education, he must have stopped every study with complete curriculum or complete learning period, he must have stopped all activities which have been imposed by a study, period of training or educational program or any other study program with complete curriculum;
2. The young employee must be recruited with an employment agreement that commences in October, November or December 2016;
3. The amount of the gross taxable salary must not exceed EUR 2,950.

No advance business tax must be withheld as the young employee will not reach the threshold of taxable income at the end of the fiscal year and will therefore, in principle, not need to pay taxes.

However advance business tax must again be withheld as of January 2017.

Source: Royal Decree dated 16 December 2015 for the amendment of the Royal Decree/WIB 92 in respect of the advance business tax, B.S. 21 December 2015.